We’re pleased to announce that we are now offering support to Binance Smart Chain within the FunFair Wallet solution.
From today any developer building a dapp in the Binance ecosystem can now implement our wallet effortlessly, saving themselves time and resources with an integrated wallet solution.
While we are delighted with the work completed by the Wallet team here at FunFair, we wanted to use this opportunity to delve deeper into BSC. Naturally, being a company that at its core believes in decentralisation, it may seem an odd selection for us to incorporate in our wallet. Below we will provide an overview and our thoughts, which led us to include support for BSC.
Launched in April 2019, Binance released their first blockchain, the aptly named ‘Binance Chain’. However, it wasn’t until September 2020 that when Binance Smart Chain launched on mainnet, it created a stir. BSC, in short, is an ethereum virtual machine (EVM) that is compatible with the ethereum blockchain. It complements Binance Chain by allowing smart contacts and developers to build apps in the Binance ecosystem.
It was willed into existence by the need for fast/high-throughput transactions that were also cheap. At the time, and to this day, the Ethereum blockchain is becoming congested and more expensive to use. Of course, they are not the only nor the first technology to offer this promise of fast and lower-cost transactions. But being backed by Binance helped fuel the growth of BSC incredibly quickly. Having funds and access to 15 million users is something that most early technologies simply don’t have the benefit of.
And BSC has leveraged this advantage very effectively, with a market cap of 15 million in January, which has since exploded to 18 billion in 5 months.
Some have even labelled BSC as an Ethereum killer. And as we see the smart contract wars heat up, many are jockeying to get ahead and take that crown, including Polkadot and Cardano, of course.
But Ethereum has a tremendous head start and the infrastructure it has and continues to build upon, including many FunFairs products. So why have we chosen to implement support for BSC DApps in our wallet over others at this stage?
To answer that question, we can’t avoid the elephant in the room and address the criticisms of BSC first.
Critics of BSC have pointed out it is just an Ethereum clone, or in other words, it is a copy of the ethereum ecosystem (of which Binance does not deny). However, while it is true it has a lot of ethereum’s work over the years to thank for its setup, the one core difference is it utilises a proof-of-staked-authority (PoSA).
Unlike Ethereum’s proof of work approach to validating blocks, validators must own and stake BNB to allow them to earn transaction fees. And this is where the decentralised wheels start to look a bit shaky, as Binance themselves chooses all the validators.
This difference is showcased by the 21 validators that BSC utilises vs ethereum’s 77,800. And with Binance hand-selecting these 21 it makes for a very centralised decision-making process.
However, it is precisely this control that allows BSC to produce blistering fast speeds and low costs. Making the process a bit more centralised ensures that it is not prohibitively expensive for new DApp developers to build on. Any developer looking to build on ethereum directly without a scaling solution in place is going to baulk at the current transaction fees (gas).
It’s a case with current blockchain technology when choosing an ecosystem, you can select a genuinely decentralised solution, low fees and quick transactions, or a vibrant DApp filled ecosystem.
But you can only choose two.
This limitation won’t always be the case as solutions are in play already looking to allow all 3 to exist together, but that will take time.
However, while technology improves, BSC currently benefits from an average block time of 3 seconds vs Ethereums 12, or to put it another way, it’s 430% faster.
Of course, by reducing the decentralised nature, you are going against the ethos of blockchain. In an entirely decentralised utopia, changes are to be made democratically by the network, which is enough for many to draw the line at BSC.
If you were to build your DApp on ethereum, you are engaging in a truly decentralised process, and you are the master of your destiny, or your voice is just as important as anyone else. Whereas on BSC, Binance can control changes on the network through their total control of the validators and can make technical changes you have no say in, to your detriment.
Furthermore, as Binance is a centralised entity initially set up in the crypto unfriendly location of China, they are a central point of failure. Governments wishing to fine or pass laws to impact their operations are a real risk.
However, as the ethereum network continues to be affected by rising costs, more and more DApp developers are finding it better to sacrifice some elements of decentralisation for cost-saving requirements to bring their DApps to life.
We wanted to offer our wallet to developers as we have been through the pitfalls of building a wallet from the ground up. We have a product that can save developers time, money, and resources.
It’s part of the reason we offer it for free; we want blockchain to continue to grow and succeed. And getting more DApps into the world is the best way to get there.
And the increase of registered DApps on BSC is phenomenal, with 945% more registered Dapps since the start of the year.
Ethereum is still heads and shoulders ahead in the blockchain space, and with the explosion of Defi, it’s not going anywhere with the infrastructure built on it. But as shown by the speed of adoption by many developers, BSC is gaining popularity. Despite the drawbacks to a more centralised network.
FunFair fundamentally believes in a truly decentralised approach to blockchain. But in the short to medium term, Binance serves a beneficial function. Thanks to its origin as an Ethereum clone, it’s a relatively low learning process for current developers to build on if familiar with Ethereum. Further, DApp developers can develop and get their products out to market without being cost-prohibitive.
And while we will continue to build support into our wallet for other blockchains such as xDai or L2 solutions like optimism, we want to give DApp developers the best chance to succeed. And that ultimately means supporting Binance Smart Chain as it has one of the fastest-growing ecosystems outside of Ethereum.